Managers must be held to account for unsatisfactory audit results - parliament

CAPE TOWN – Managers need to be held to account for the unsatisfactory latest national and provincial audits, parliament's standing committee on the Auditor-General (AG) said on Sunday.

Committee chairwoman Nthabiseng Khunou called for greater accountability for the decline in national and provincial audits. She was reacting to the AG's announcement this past week that departmental and public entity audit outcomes had regressed in the past financial year.

“It is unacceptable that instead of improving, 73 auditees regressed. While we welcome the 43 improved auditees, we remain concerned that a greater bulk of auditees have shown a decline. It is also concerning that the root causes, according to the AG, is that those charged with governance are either slow to implement or totally disregard audit recommendations made by the AG,” Khunou said in a statement.

The committee believed that consequence management against those that had disregarded the AG’s recommendations should be strengthened. Furthermore, the committee was convinced that the impunity shown by managers in misspending taxpayers' resources could not continue unabated, as it had a direct impact on service delivery.

Some of the main areas of concern for the committee were the serious weaknesses in the financial management of national and provincial government, which had not been addressed over the past four years; the over 200 percent increase in fruitless and wasteful expenditure from the previous year to R2.5 billion; and the ongoing deterioration in the financial health of auditees, she said.

Also of major concern was the increasing litigation against departments, which diverted already scarce resources earmarked for service delivery to servicing those claims.

The non-compliance with supply chain management (SCM) legislation, which led to an increase in irregular spending, had to be curtailed. “While there might be justifiable reasons why in some cases the SCM framework cannot be followed, the committee attributes the increase in irregular spending to lack of proper planning and foresight, which leads to overspending. Senior managers must be held accountable for this lapse in planning,” Khunou said.

The committee was concerned by the finding that the financial health of provincial departments of health and education needed urgent intervention to prevent the collapse of these key service delivery departments. Education was a central pillar if South African was to achieve the growth projections necessary to create much-needed job opportunities for the majority of South Africans. The department of health was also important in ensuring an improved quality of life for South Africans.

"The committee is hopeful that the implementation of the Public Audit Amendment Bill will act as a deterrent against disregarding the AG’s recommendations and will improve accountability. The committee emphasises its call that the office of the AG must move with speed to develop and implement regulations necessary to implement the bill," Khunou said.